Views of Ms. Sarabjit Kour Nangra (VP Research - IT, Angel Broking) on Wipro

Wipro Update on Chennai Operations:

"Wipro Limited, a leading global information technology, consulting and business process services company has provided a business update on its Chennai Operations. The recent heavy rainfall and resultant flooding impacted the regular business operations of Wipro's Chennai facilities during the first week of December. Wipro has multiple facilities in Chennai with over 22,000 employees. Wipro has largely seen the restoration of normal operations in Chennai facilities. Wipro has adequate insurance coverage and is in touch with the insurance companies to assess the damage and the claim will be subject to policy terms.

In terms of guidance, for the quarter ending on December 31, 2015, the incident is expected to have a material impact on the revenues and will result in higher one-time cost incurred towards deployment of their business continuity plan. Both these factors will impact companies Operating Margins for the quarter. Revenues from its IT services business are expected to be in the previously communicated range of US$ 1,841mn - $ 1,878mn; however, the company expects the revenues to be in the lower half of the guidance range. Guidance is based on the following exchange rates: GBP/USD at 1.55, Euro/USD at 1.12, AUD/USD at 0.72, USD/INR at 65.34 and USD/CAD at 1.33. Consequently we are reducing our FY2016 sales and EPS numbers, by 3.1% and 2.7% respectively. We maintain our BUY with a price target of INR 719."

Shares of WIPRO LTD. was last trading in BSE at Rs.555 as compared to the previous close of Rs. 558.6. The total number of shares traded during the day was 186065 in over 2843 trades.

The stock hit an intraday high of Rs. 559.15 and intraday low of 553. The net turnover during the day was Rs. 103386489.

Source : Equity Bulls

Keywords